7.

In accordance with the resolution of August 15, 1876, the Army
regulations prepared under the act of March 1, 1875, have not been
promulgated, but are held until after the report of the above-mentioned
commission shall have been received and acted on.

By the act of August 15, 1876, the cavalry force of the Army was
increased by 2,500 men, with the proviso that they should be discharged
on the expiration of hostilities. Under this authority the cavalry
regiments have been strengthened, and a portion of them are now in the
field pursuing the remnants of the Indians with whom they have been
engaged during the summer.

The estimates of the War Department are made up on the basis of the
number of men authorized by law, and their requirements as shown by
years of experience, and also with the purpose on the part of the bureau
officers to provide for all contingencies that may arise during the
time for which the estimates are made. Exclusive of engineer estimates
(presented in accordance with acts of Congress calling for surveys and
estimates for improvements at various localities), the estimates now
presented are about six millions in excess of the appropriations for the
years 1874-75 and 1875-76. This increase is asked in order to provide
for the increased cavalry force (should their services be necessary),
to prosecute economically work upon important public buildings, to
provide for armament of fortifications and manufacture of small arms,
and to replenish the working stock in the supply departments. The
appropriations for these last named have for the past few years been
so limited that the accumulations in store will be entirely exhausted
during the present year, and it will be necessary to at once begin to
replenish them.

I invite your special attention to the following recommendations of the
Secretary of War:

First. That the claims under the act of July 4, 1864, for supplies
taken by the Army during the war be removed from the offices of the
Quartermaster and Commissary Generals and transferred to the Southern
Claims Commission. These claims are of precisely similar nature to those
now before the Southern Claims Commission, and the War Department
bureaus have not the clerical force for their examination nor proper
machinery for investigating the loyalty of the claimants.

Second. That Congress sanction the scheme of an annuity fund for the
benefit of the families of deceased officers, and that it also pro